Economics of the eBook Glut: Is Free the New Hot Price?
I come from a business background with a very basic understanding of Economics, namely the concept of supply and demand. As an unknown author, I face the problem of anonymity. No one knows who I am or about my book because I am one of a gazillion self-published authors. In terms of Economics, this means I am dealing with an infinite supply of ebooks I can provide to readers, and with this infinite supply, I have zero demand, which, under the basic laws of Economics, means I should put my price at the lowest possible rate until I can increase demand or demand increases on its own. Until said demand increases, I have few options.
One option is the low-price Amazon strategy and keep my book at $0.99, but there are a ton of books selling for $0.99 — how can I compete? Economics says lower the price; undercut the competition. If I want to offer my book at the next lowest price (free), Amazon would require me to pull down my book from all other sites and sell exclusively through them, and in return they would allow me to give away my book for five days over a 90 day period. I don’t want to be exclusive to Amazon, nor do I want my book forcibly for sale if I want to say, just give it away. But why would I give it away?
There is a literal glut of low-priced and free books out there. The slush pile has officially moved online. Self-publishing has allowed anyone and everyone to become an author, so now everyone is competing in a saturated market. I had a client in my freelance writing business recently who is in publishing and he was bemoaning the fact that media doesn’t sell like it used to because everyone wants something for free. And aren’t the makers of media slaves to what the consumers want? In this new era of publishing, is free what the public demands? Is $0.00 the new $0.99 — a price point that spawned a slew of self-publishing success stories?